COVID-19 brought to light the vulnerability of our manufacturing operations and supply chain weaknesses. It even interrupted the supply chain of monetary coin flow with a reported nationwide shortage of nickels and dimes. The true disruption to our supply chains remains unknown, as it could hamper manufacturing for months and perhaps even years.
The forces beyond a business’s control – a natural disaster or global pandemic – require enterprises to improve the quality and pace of decision making. Long before COVID-19, traditional supply chain networks and supplier relationships weren’t built to handle today’s digital landscape. With a rising tide of global uncertainty and business complexity, it’s paramount that the supply chain of the future be resilient, predictive, customer-centric and not driven by process, but by demand.
What’s Driving Change?
Amazon has fueled the growing consumer demand for choice and rapid fulfillment, forcing businesses to warehouse goods closer to customers and shorten the end-to-end timeline. According to Forbes Insights, 44% of senior executives said the Amazon Effect is having a dramatic impact on more than their logistics, supply chain and transportation operations.
Supply chains of the future will rely on emerging technologies to connect business networks and understand their customers, boost engagement and retain loyalty in an ever-changing marketplace. The old model of “stack it high” with truckloads arriving daily is being swiftly replaced by home delivery, store pickup, delivery lockers and other new retail models.
The linear concept of a supply chain is no longer adequate for today’s complex company-specific international configurations of suppliers, partners, regulators and customers. By 2024, at least 75% of top 50 global companies will have implemented supply chain business networks in support of end-to-end supply chain visibility. Future-ready leaders recognize that supply chain visibility extends end-to-end, across customers and suppliers, and has implications for the level of data needed, the sophistication of supporting technology, and the amount of collaboration necessary to execute the vision.
The Evolution of Visibility
By the very nature of supply chains, supply chain management tends to produce massive amounts of data. Creating a digital infrastructure that prioritizes visibility and connectivity creates a critical mass of usable data. The challenge then lies in the ability to develop actionable insights that bolster supply chain efficiency and better manages supply chain risk.
Collecting, storing and analyzing data has become an integral function across not only the supply chain but every relationship and operational platform within an organization. Future-ready organizations are focused on cross-functional supply chain visibility that covers all functional domains and connects to business partners within and across the organization. This type of operational visibility provides data-driven insights on a variety of data objects and serves as a basis for intelligent decision making. Redefining supply chain visibility within an organization is not immediate, but a proactive journey towards the benefits visibility provides.
Supply chains should be strategic, a business enabler, a revenue driver and a differentiator. They are the enablers of commerce in today’s increasingly connected world. Even in 2014, 79% of companies with high-performing supply chains reported achieving revenue growth superior to the average within their industries.
As businesses compete on supply chain capabilities, as much as on their actual products, it’s important to build a future-ready supply chain – one that utilizes the most relevant data and emerging technologies to manage network operations and respond efficiently during times of increased demand. As businesses begin their proactive journeys to evolve their supply chains, we’ve identified five key attributes of future-ready supply chains to consider:
- Strategic: Pragmatic roadmap prioritizing the use of emerging tech while aligning people, processes and technology
- Connected: Convergence of processes and integrated internal and external systems with a structured approach to data standardization and management, ultimately improving the customer experience
- Visible: Access to data and events across all functional domains and connecting business partners within and across the organization to enable effective execution
- Intelligent: Application of analytics for improved decision making and proactive insights
- Resilient: The ability to confront unforeseen risks and recover operational capabilities quickly from changing market demand after disruptions occur
The supply chain of the future must be defined by new qualities and responsive to ever-changing circumstances. In our upcoming blog series, we will explore each attribute of a “Future-Ready Supply Chain.” You’ll learn how to unlock the full potential of your supply chain, architecting supply chain predictability, visibility and speed of delivery to make confident decisions, at the speed of life.